Focus on - Interview by Franco Tanel

Connecting Cuzco to the legendary Machu Picchu by rail

Perurail, not just for luxury tourism

Perurail is definitely the most well-known Peruvian rail operator in the world, thanks to the tourist services it offers (both budget and luxury) which take passengers to Lake Titicaca and the famous archeological site of Machu Picchu. 50% owned by Peruvian Trains and Railways (PTR) and Orient-Express Hotel Ltd, is offers various levels of service, from the exclusive Hiram Bingham to the elegant Andrean Explorer and the Vistadome. But the company also offers passenger links for the local population and operates in the goods sector with an important division named Perurail Cargo. We invited Armando Pareja, the companys General Manager, to describe Perurail for us, its history, its current activities and its plans for the future. Railway Engineering: Could you describe the profile of the company Perurail for us? What is its structure? What are its goals? Armando Pareja: Perurail are the leading rail transport company in Peru. The company was founded in 1999 with Peruvian and British capital in order to operate passenger and goods train services in the south and south east of Peru. The operation covers 980 km of rail lines which are divided into two sections: the standard gauge (1,435 mm) Ferrocarril del Sur (Southern Railway), covering 860 km and connecting the Peruvian high plateau, Juliaca/Puno (3,600 metres above sea level), Cusco (3,300 metres above sea level), with the port of Matarani on the coast; and the metric gauge (914 mm) Ferrocarril del Sur Oriente

Perus main rail operator also provides an important cargo service

(South Eastern Railway), covering 120 km and connecting the city of Cusco with the Inca citadel of Machu Picchu. The Cusco-Machu Picchu route is designed for passenger transport, carrying in the region of 2 million passengers per year. The operation of our trains is therefore managed mainly from the city of Cusco, and it is there that both the locomotive and rolling stock is stored and the passenger carriages and railcars are refurbished. On the Southern route, its most important goods operation is the transportation of copper concentrate for the mining company Sociedad Minera Cerro Verde, in Arequipa, as far as the port of Matarani. The operation of our goods trains is managed from Arequipa, where we have mechanical repair shops for overhauls, as well as important stations such as La Joya, where the copper concentrate is transferred to trucks for the last leg of the journey to the port of Matarani. Perurail is a company committed to the advancement and development of Peru, with high quality standards of service, safety and punctuality. In 2011, Perurail gained global recognition when it was given the Hiram Bingham award for best tourist train in the world by the prestigious Cond Nast Traveller magazine. In addition to this, we achieved another important goal when we obtained 3 of the most demanding certifications for goods transportation, ISO 9001 (Quality Management Systems), ISO 14001 (Environmental Management Systems) and OHSAS 18001 (Occupational Health and Safety Standards). 43

Armando Pareja, General Director of Perurail

Focus on - Interview

RE: Perurail has won from the Government the management of several railway lines: what are the details of this franchise? Does the infrastructure remain the property of the Government? Are maintenance costs and investment in tracks and stations your own responsibility, or are there any financial contributions made by the Government? AP: Ferrocarril Transandino (Trans-Andean Railway) has been awarded the franchise for the railway lines in the south and south east of Peru, which means that they manage, repair and maintain the track in a suitable condition for the operators to run on. FT covers the costs of maintenance and any investment in tracks and stations under their control; in addition, they pay two remuneration payments to the government as part of the franchise agreement. Both the infrastructure, as well as any work or improvement carried out, belong to the Government. There are currently 3 operators on the south eastern route, Perurail being one of them. Perurail owns a few wagons, but other wagons as well as 44

locomotives are rented from FT. Any renovations or improvements to the rented rolling stock therefore remain the property of FT. RE: What railway lines are currently operating? According to the information we have, some lines in the Machu Picchu area are operative but others are not, especially the narrow gauge ones ... AP: From 2 January to 15 April 2012, the narrow gauge south eastern route is operating through a bimodal service. These months register the highest rainfall

in the Andes region, with the possibility of mudslides or landslides in the Quebrada de Pomatales section. We have therefore implemented this seasonal service in order to guarantee passenger safety. Only the Cusco-Pachar section is closed, between kilometres 34 and 61. Train services between Pachar, Ollantaytambo, the village of Machu Picchu and the Hidro-electric Power Plant will run normally. RE: Which standard gauge lines are operating?

AP: The standard gauge southern route is operating normally. RE: Perurail is strongly committed to tourist passenger services. Could you give us more details of the services you offer in this sector? AP: Our commitment is very clear: to offer our passengers the best possible experience during their visit to Peru, which includes a safe and punctual service. Perurails services meet all international standards in safety and quality of

Interview - Pareja di Perurail Focus on with Armando Pareja, General Director of Perurail
service but, far more than just a transport service, we provide a wealth of travel experiences. We offer 6 different services covering each type of traveller, with more than 15 daily departures and prices that vary according to the service provided. The Hiram Bingham train is aimed towards a select type of traveller who is looking for an exclusive and unforgettable experience in a world of sophistication, in the style of the OrientExpress, where every detail of the journey has been carefully thought out for the benefit of the traveller. The return fare includes a welcome drinks reception at the Poroy station, brunch, exclusive coach plus admission with guide to the Inca citadel, tea time in Machu Picchu Sanctuary Lodge, gourmet dinner, as well as Andean musicians on board. The Vistadome train is a sophisticated and sensory journey on the way to Machu Picchu, and with this service passengers will have the opportunity to explore with all their senses. Brunch, together with all the snacks, are prepared from local ingredients; we combine a fashion show with local dances; and our panoramic windows provide the best views along the route. The Expedition train is aimed at travellers who are young in spirit and adventurous, but also enjoy a quality service. This service offers comfort, a lower fare and various timetables to choose from. The Servicio Especial is an all inclusive service, but at cheaper fares than the Hiram Bingham. The Autovagn is a service that operates from Machu Picchu to the station of Urubamba, located

near the Tambo del Inka hotel, while the remaining services end in Cusco or Ollantaytambo. The Andean Explorer is the only train which operates on the Cusco-Puno route, and this is a luxury service recognised throughout the world as one of the best railway routes available, due to its beautiful landscapes and excellent service. The price includes gourmet lunch on board, afternoon tea, live Andean music, the preparation of pisco sour cocktails, a fashion show and a stop at the highest point on the route, La Raya, at 4,321 metres above sea level. RE: In terms of the usual transport of passengers, how many passengers do you transport on average per year, including both tourists and ordinary passengers? AP: In 2011 the passenger division carried nearly 16 thousand tourists on the Cusco-Puno route, one of the highest in the world, on board the Andean Explorer train. On the Cusco-Machu Picchu route we carried more than 1 million tourists last year on the Hiram Bingham, Vistadome, Expedition,

Servicio Especial and Autovagn train services. In addition, we have the local train service between Cusco and Aguas Calientes, which is subsidised by Perurail, with preferential fares for residents of Aguas Calientes, the communities in the Perurail catchment area, inhabitants of the Cusco region, as well as our own Peruvian tourists. In 1999, when Perurail first started operating, this train carried 125 thousand passengers a year. In 2011, it carried 584 thousand passengers. RE: Your company also transports goods: what are the rail connections and the principal products you carry? Is it a significant amount of traffic in terms of the tonnage transported and the companys economic performance? AP: In terms of goods transport, Perurail has gradually gained in strength as it attempts to meet the needs of a demanding and unsatisfied market whose expectations are geared towards high-volume transportation. As a result, and thanks to its quality of service, Perurail has gradually gained a larger market share in the southern region catchment area.

We specialise in the bimodal (Truck and Train) transportation of minerals or copper concentrates, in which we have achieved the highest standards of safety, quality and environment, as shown by our ISO 9001, ISO 1401 and OHSAS 18001 certifications. In addition, we transport fuel, coal and concentrates, as well as general merchandise, in container type storages. In 2011 we transported 1.2 million tonnes on both routes, just over 1 million of which came from the Cerro Verde mine. RE: What rolling stock is currently in service? Are you planning any future investments in this sector? AP: Since the start of our operation, we have followed an intensive investment programme amounting to more than US$ 100 million so far. Looking towards the future, our investment programme for the next 10 years is substantially higher: $110 million to sustain and improve our current operation and, according to current estimates, a further $200 million for new goods projects. Photographs from Perurail archive 45

Franco Tanel